Late last month, State Comptroller Matt Boxer released an audit that identified more than $23 million in benefit payments made to or on behalf of prison inmates who did not appear to be entitled to such payments.

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More than $10 million of the benefit payments identified by the audit were unemployment insurance benefits paid out to more than 7,600 people behind bars. A new bill aims to make sure that never happens again.

A Senate committee has approved legislation requiring the state to establish a verification process so that unemployment checks are not sent to prisoners. Senators Fred Madden, Paul Sarlo, Sandra Cunningham, and Jeff Van Drew sponsored the legislation designed to prevent any further abuse of benefits programs by those serving time for criminal activities.

Bill Would Create Verification Process

"These benefits are intended to help those who really need it because they can't find work, not for those serving time for their crimes," says Madden. "This bill will create a verification process and require state officials to check against inmate records to prevent any abuse of the system or misuse of the funds."

The legislation would have the state Department of Corrections and the Administrative Office of the Courts supply the Department of Labor and Workforce Development with the names and Social Security numbers of every inmate in state prisons or county jails. The Labor Department would then be required to create a verification process to make sure no checks are sent to any prisoner.

"The verification process needs to be updated and modernized to make use of computerized technology," says Sarlo. "State officials need to be thorough and diligent in checking all the records so these funds aren't lost to convicted criminals engaging in fraudulent practices that amount to the theft of public resources."

The majority of the fraud uncovered by Boxer was committed by county inmates, exposing a weakness in the current verification process that fails to thoroughly check against county correctional records and that relies too much on informal controls, such as manual reviews of paper records. The new system would make use of electronic data that includes complete listings of county prisoners.

"There are a lot of people out of work who need and deserve these benefits to get by," points out Cunningham. "That's where the support should go, not to those who are behind bars."

Deceased People Were Getting Checks

The measure also directs the state to include death records in the reference system. A previous review of unemployment payments found 50 cases where a total of $237,000 was distributed after the "recipient" had died.

One so-called claimant died in October of 2008 but collected more than $8,000 between February of 2010 and May of 2011 and six others were still collecting payments as of October 1, 2011 even though they died up to 11 months prior.

"The fraud that was uncovered in the public benefits program exposed a gaping hole in the system," says Van Drew. "This bill will strengthen oversight to ensure that inmates who are being supported by taxpayer dollars are not also collecting benefits they are not eligible for and that should be going to folks that need them."